Relocating your business internationally: Key steps and legal considerations

  • business relocation
Published on 2024-05-21 at 10:00 by Asaël Häzaq
Relocating your business to another country involves complex operations such as managing personnel, communication, and the physical relocation. What should you take, sell, or donate? What formalities are required?  

Moving offices and/or headquarters abroad

What does moving your business entail? Typically, it involves transferring the headquarters abroad. A company must have a headquarters, which is its legal, postal, fiscal, and administrative address. This address determines the company's nationality and the applicable laws. The headquarters can be a physical office, your home, or a mailbox in a shared office space, depending on your legal status and local laws. Companies often relocate abroad for tax, legal benefits, proximity to markets, or branding.

There can be multiple addresses: one for the headquarters and another for business activities. A company has one headquarters but can have several activity locations. Do not confuse the two when moving abroad. The move might only involve a business activity address, not the headquarters. You can operate at your headquarters' location, which means relocating your office will also move your headquarters abroad.

Transferring headquarters abroad

Relocating the headquarters abroad changes the company's nationality, subjecting it to the new country's laws. The process varies by legal status and involves dissolving the current company while retaining its legal status temporarily to create a new company abroad. It's best to choose a legal status similar to the previous one. Practically, this requires a transfer plan, including repaying loans, paying taxes, voting on the transfer, and amending statutes. The EU has harmonized laws to allow entrepreneurs to operate across member countries, supporting the principle of establishment freedom.

Moving offices abroad

Physically moving the business is as complex as moving the headquarters. EU companies relocating within the EU have simplified regulations. The move involves more than just relocating offices; it includes employee expatriation, transporting sensitive data and equipment, managing clients and partners, ongoing contracts, mail, customs formalities, potential revenue loss during the move, etc. Thus, it is essential to hire specialized corporate relocation companies.

Changing premises

Terminate your current lease and sign a new one in the host country. Ensure your company meets all criteria to establish itself in the chosen legal form abroad. Engage a legal expert to assist with all procedures.

Canceling subscriptions and contracts

Cancel mobile and landline phone, internet, electricity, water, and gas subscriptions. Don't forget other company subscriptions (cleaning services, various services). Depending on your business, you might need to keep some subscriptions, like for press. Switching from paper to online subscriptions can save additional costs and avoid delivery delays.

Packing and transporting company assets

To avoid losses, damages, or breakages, create a detailed inventory of all company assets. Locate contracts for various items (especially IT equipment and machines) and store them securely. Have an electronic copy and an understandable classification system. For instance, IT equipment, electronic equipment, fragile items, decorative objects, work clothes, work equipment, etc. Assign responsible persons for each department and a move coordinator. Hire professional movers and inform them of sensitive items. Packaging should be appropriate and clearly labeled for content and fragility. Pay special attention to heavy equipment (machines, large devices).

Moving costs

Moving your business abroad may incur significant costs. Plan ahead to decide what to keep, sell, or buy locally. Your inventory will help evaluate options. Do you need to move all your furniture and lights? Can your shelves stay behind? The second-hand market is also an option. More companies collaborate with businesses that refurbish and sell their furniture. This can be cost-effective (less transport and installation costs). If the host country has a recycling market, you could save by furnishing with second-hand items.

Transferring employees abroad

The office move also affects employees. Are they required to move? It depends on their contract and the company's new location. If the contract includes a mobility clause, the employee will relocate without needing consent. However, the employer must ensure that the clause about international mobility and specific areas is clear. Without a mobility clause, employee consent is mandatory before relocation. Without consent, they may be dismissed for economic reasons.

Communicating with collaborators

Effective communication is crucial to retain employees. Inform and reassure clients if deadlines might not be met due to the move. Clients may worry about service continuity, accessibility, and quality. Engage a communication officer or agency to maintain and boost your brand image. Create a story around your move and strengthen ties with suppliers, partners, and clients. This could also lead to new contracts during interactions with moving professionals.

Importance of professional support

Relocating a business abroad is not improvised. Consult an international transfer legal expert to avoid surprises. Compare international moving companies to find the best fit for your situation. Movers might offer secure storage until you find a suitable location abroad.

Do not underestimate the human impact. Even with international mobility clauses, make sure to involve employees early. Their families are also affected. Ensure a clear mobility clause and a budget for employee expatriation. Planning their transfer alongside the business ensures a successful start in the new country.